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Business Council calls for cull on State powers

AM - Wednesday, 7 February , 2007 08:24:00

Reporter: Peter Ryan

TONY EASTLEY: The historic and often counter-productive rivalry between State and Federal Governments has cursed Australian politics since the first day of Federation.

After more than a century of bickering, the big end of town has had enough.

The Business Council of Australia, which represents more than 100 CEOs, wants the Prime Minister to end what it calls the impasse over regulations and policy fiefdoms that some State Governments hold so dear.

Business Council President Michael Chaney is speaking with our Business Editor Peter Ryan.

PETER RYAN: Michael Chaney, thanks for joining AM.

Is it time for State and Territory Governments to hand over some of their powers, particularly in light of the current water debate?

MICHAEL CHANEY: Well I think what needs to happen, firstly, is for the States and Federal Government to sit down and talk through what ought to happen with Federal-State relations in a whole lot of areas and decide who should be doing what.

And one of the things we've been arguing for is that Australia ought to be a common market. You know, we've got a country of just over 20 million people and in Europe there's 450 million people with a common market and we haven't seemed to be able to achieve it.

So we've suggested there should be a federal convention in 2008 and we should be all sitting around and saying, how should we run this country most effectively, because we need to be efficient if we're going to compete in the world economy.

PETER RYAN: But how realistic do you think is the proposal for a common market, particularly as we're now in an election year?

MICHAEL CHANEY: Well I think the election year does complicate it a little because people will seek to take advantage of different positions, but we, I think, have seen some pretty encouraging signs from some of the State Premiers and also from the Commonwealth about their intent in this regard, but what we really need is action.

PETER RYAN: How confident are you of the Federal Government taking the bold steps you're suggesting and is there a deadline that you're proposing for action?

MICHAEL CHANEY: We've suggested that unless the Governments, presumably through COAG (Council of Australian Governments), really start to make some progress in these areas, that the Federal Government should consider taking over some of them.

We've seen the High Court decision last year that gives the Government clear authority in the area of workplace relations and our view is that if, in fact, for example, for political reasons you can't achieve real breakthroughs in cooperation between the Federal Government and the States, then somebody has to take the lead in it.

PETER RYAN: Well we have had a long period of economic growth fuelled by the resources boom, but are you concerned about what happens to the economy and business when that boom is finally over?

MICHAEL CHANEY: I think it is a real concern. If the resources prices turn down, as no doubt they will at some stage, then - and we haven't made sure we're efficient and open as an economy - we're going to suffer a severe recession.

That's why we think there needs to be, really, a new round of reform and the reform of Federal-State relations and the arrangements between the States and the Federal Government is a critical part of that.

PETER RYAN: Given that we're in an election year, how are you building relations with the Labor Party after a rocky time in recent years?

MICHAEL CHANEY: The real difference we have with them, I think going forward is going to be over workplace relations. We think Work Choices has been a fantastic thing for the Australian economy and the Australian worker.

TONY EASTLEY: The President of the Business Council of Australia, Michael Chaney, speaking with Peter Ryan.